Below is an excerpt from ISS-Corporate’s recently released article “CARB Updates on California Climate Laws: SB 253 & SB 261 Guidance.” The full article is available on the ISS-Corporate online library.
California Climate Accountability Package: What You Need to Know
The California Air Resources Board (CARB) hosted a public workshop on August 21 to discuss the California Climate Accountability Package (CCAP). This was the second of two workshops hosted by CARB this summer. The first workship was held on May 29, and you can read our summary of it here.
The CCAP requires companies doing business in California to annually disclose scopes 1, 2, and 3 greenhouse gas emissions (SB 253) and to biennially report on climate-related financial risks (SB 261). The two laws are also collectively referred to as “the 200s.”
The latest workshop proposed key clarifications for the laws including updated definitions, reporting timelines, fee payments, and minimum reporting requirements. However, full regulatory guidance is still a work-in-progress and expected to be released by the end of the year, leaving little time for covered entities to incorporate relevant updates.
ISS-Corporate Key Takeaways
- Definitions and scope are still pending: Definitions for “revenue”, “doing business in California”, and parent-subsidiary considerations have yet to be finalized. CARB requested additional public feedback.
- Proposed exemptions under SB 253 and SB 261: CARB proposed certain entities to be exempt from reporting, including non-profits, government entities, and companies whose only business in California is the presence of teleworking employees.
- New implementation fee structure: CARB proposed a new flat fee structure, with the fees adjusted annually for inflation. CARB estimated the 2026 fees for SB 253 and SB 261 to be $3,106, and $1,403, respectively. Entities that are subject to both regulations must pay both fees.
- Updated reporting deadlines: For SB 261, reporting deadline of January 1, 2026, remains firm. Starting December 1, 2025, companies can submit their climate reports to a public docket. For SB 253, CARB proposed a deadline of June 30, 2026, for scopes 1 and 2 emissions.
- Regulatory guidance timeline: CARB released a draft checklist for SB 261 on September 2, 2025 (details below).CARB plans to release additional guidance, including a draft reporting template for scopes 1 and 2 emissions (SB 253) by the end of September 2025, and a notice for rulemaking by October 14, 2025.
By:
Sara Derian, Senior Associate, Sustainability Advisory, ISS-Corporate
Jessica Lobo, Associate, Sustainability Advisory, ISS-Corporate
